RADNOR, Pa.--(BUSINESS WIRE)--New data released today by Hartford Funds uncovers Americans’ top financial concerns as they age, as well as what worries them most about their aging parents. Overwhelmingly, Americans worry about becoming a financial burden on their family members as well as not having saved enough money. In addition, survey respondents are most worried about their aging parents maintaining a high quality of life. The survey also revealed specific actions being taken to combat these concerns head-on.
“Finances are of course important, but disproportionate compared to qualitative issues like caregiving and maintaining a social network of family and friends,” said John Diehl, Senior Vice President, Hartford Funds. “Advisors need to be thinking about these qualitative, human-centric considerations when they approach discussions about aging with their clients.”
Eliminating the Financial Burden on Children
Running out of money and becoming a financial burden to their children are the top concerns associated with aging identified by survey participants (40 percent). Younger respondents, those between 35 and 54 years old, are particularly worried about these issues; nearly half (45 percent) cited these concerns, compared with one-third of their older counterparts. Additional disparities emerged on the topic when looking at income. Specifically, those with income between $75,000 and $100,000 are more concerned about these issues than any other income group. In fact, they are nearly twice as likely to worry about being a financial burden on children or running out of money as respondents who make $50,000 to $74,999 annually (50 percent and 29 percent, respectively).
In order to address concerns about being a burden on their children, generally most Americans are taking proactive measures. Forty-two percent are making strategic living arrangements, including physically moving to accommodate their lifestyles (22 percent) or setting themselves up to be accessible for caregiving by moving closer to children or into an aging care home or community (20 percent). Women, in particular, are making arrangements for caregiving, outnumbering men nearly two-to-one (26 percent versus 14 percent). Twenty-two percent are working with an advisor to get finances in order; men in particular are more likely than women to engage a financial advisor (28 percent versus 17 percent).
Maximizing Quality of Life for Mom and Dad
Americans’ general top concern for their aging parents is tied to quality of life issues. A quarter of respondents (26 percent) feel that having a home their parents are physically able to maintain and easily move around in is most important. Others are most concerned about their parents maintaining a social network of friends and family (20 percent). Interestingly, respondents ages 35 to 44 were much more likely than their older counterparts to be concerned about their parents’ ability to maintain a social network (28 percent versus 17 percent).
In general, Americans are also addressing the concerns they have about their aging parents by either moving closer to their parents or moving their parents closer to them (32 percent). In particular, 35 to 44-year-olds were more likely than older respondents to move closer to their parents or have parents move closer to them (39 percent versus 20 percent).
“Moving to be closer to your parents or moving them closer to you is a decision with enormous financial and quality of life implications, for both parties. It’s important to proactively communicate with family about these decisions and seek advice from a trusted source,” Diehl added.
The Communication Vacuum
These decisions appear to be occurring overwhelmingly without clear family communication. The survey revealed that only a small number are initiating conversations with their loved ones about their own and their aging parents’ intentions as they age (an underwhelming 14 percent and 12 percent, respectively).
“These percentages should be significantly higher, considering the implications these conversations can have on quality of life. Americans should be starting a dialogue sooner rather than later,” Diehl continued. “Avoiding or overlooking these conversations today can lead to significant challenges down the road, including family conflicts and logistical and financial complications.”
Additional information on how to navigate client discussions, anxieties and other challenges and what the future of financial advice looks like can be found on Hartford Funds’ website.
The subsequent paragraph describes the methodology used for the ORC International Telephone CARAVAN® survey conducted February 11-14, 2016.
The study was conducted using two probability samples: randomly selected landline telephone numbers and randomly selected mobile (cell) telephone numbers. The combined sample consists of 1,006 adults (18 years old and older) living in the continental United States. Of the 1,006 interviews, 506 were from the landline sample and 500 from the cell phone sample. Of the 1,006 interviews, 775 were 35+. For the purposes of the data used in this press release, 566 respondents have a child or children age 18 or older and/or have a living parent age 65 or over. The margin of error for the sample of 1,006 is +/- 3.09% at the 95% confidence level. Smaller subgroups will have larger error margins.
About Hartford Funds
Founded in 1996, Hartford Funds is a leading provider of mutual funds and 529 college savings plans. Using its human-centric investing approach, Hartford Funds creates strategies and tools designed to address the needs and wants of investors. Leveraging partnerships with MIT AgeLab and leading practice management experts, Hartford Funds delivers insight into the latest demographic trends and investor behavior. Hartford Funds offers a diverse line-up of more than 45 mutual funds, primarily sub-advised by Wellington Management, designed to address the challenges investors face and includes equity, fixed-income, multi-strategy, and alternative investments. The Company has mutual fund assets under management of $74.4 billion as of December 31, 2015 (excluding assets used in certain annuity products). For more information about the fund family, visit www.hartfordfunds.com.
All investments are subject to risk, including the possible loss of principal.
The MIT AgeLab is not an affiliate or subsidiary of Hartford Funds.
Investors should carefully consider the investment objectives, risks, charges, and expenses of Hartford Funds before investing. This and other information can be found in the prospectus and summary prospectus, which can be obtained by calling 888-843-7824 (retail) or 800-279-1541 (institutional). Investors should read them carefully before they invest.
Hartford Funds are underwritten and distributed by Hartford Funds Distributors, LLC. Hartford Funds Management Company, LLC is the Funds’ investment manager. The Funds are sub-advised by Wellington Management Company LLP (with the exception of certain fund of funds), a SEC-registered investment adviser unaffiliated with Hartford Funds. “The Hartford” is The Hartford Financial Services Group Inc. and its subsidiaries. Hartford Funds Distributors, LLC is a subsidiary of The Hartford Financial Services Group Inc.
Some of the statements in this release may be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. We caution investors that these forward-looking statements are not guarantees of future performance, and actual results may differ materially. Investors should consider the important risks and uncertainties that may cause actual results to differ. These important risks and uncertainties include those discussed in The Hartford’s Quarterly Reports on Form 10-Q, our 2015 Annual Report on Form 10-K and the other filings The Hartford makes with the Securities and Exchange Commission. We assume no obligation to update this release, which speaks as of the date issued.
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